Despite encouraging progress there’s still more to be done to close the number gap between male and female directorships.
While it’s widely acknowledged that gender diversity in corporate boardrooms is linked to better business performance and better consumer representation, women are still largely under-represented on boards across Australia and the globe.
At the end of 2018, the Australian Institute of Company Directors (AICD) released its gender diversity statistics that revealed women accounted for 29.7% of all ASX200 board positions.
Although this is an increase of more than 10 percentage points and falls just short of the 30% target set by the AICD in 2015, Deakin Business School (DBS) academic Dr Heather Round says there’s more work to be done in closing the gap.
‘Of course this is a good start but it can’t be seen as the end goal - 30% is still not representative of the working population given that, according to the ABS 2018 Labour Force statistics, 53% of full-time employees are women and 47% men. Despite the improvements at the board level, leadership roles still remain elusive for females with the ABS reporting in September 2018 that only 17% of CEOs are female,’ she explains.
Dr Round is a senior lecturer in the Department of Management and has an extensive career working with global government, public and private organisations where she specialises in organisational change and the development of management capabilities.
She says that while ensuring board diversity is fundamentally ‘the right thing to do’ even if an organisation doesn’t consider the ethical aspects, there are compelling reasons why gender diversity has a positive impact on the success of the organisation.
‘Having greater levels of diversity have been shown to increase creativity and also to positively impact the decision making of boards. More broadly within the organisation, having visible diversity at the leadership level also sends a strong signal of the organisational values and culture which can be very beneficial in terms of attracting and retaining talent.’
Given the large percentage of females who are consumers and/or shareholders of a company, gender equity can also influence positively on buying and investment decisions.
‘This is particularly the case in Australia where there is a growing trend towards ethical consumerism and responsible investment with individuals starting to question the underpinning ethics of an organisation as well as the transparency of the value chain when making decisions about purchasing or investing,’ she says.
So what are some of the barriers to women taking seats at the boardroom table?
Dr Round says there are systemic issues at play – including education, training and opportunity – that influence lower numbers.
‘For example, from an education and skills perspective, only 39% of Deakin MBA students are female so this means there’s likely to be unequal gender representation in a selection process for senior roles where an MBA is seen as desirable. It also means that fewer females will have the necessary skills and competencies (that are provided by an MBA) that are needed at the executive level.’
Another reason she suggests, is that senior level appointments are often initiated via networks and referrals and many senior male executives have not had the opportunity to develop strong female networks which can then be referred to in the search for board positions.
To accelerate gender equity on boards, Dr Round says it’s first about changing the culture of organisations – a shift that needs to start from the top.
‘The leadership of an organisation needs to be very overt in its authentic support of diversity and this also needs to be reflected in the organisation’s narratives, symbols, practices and procedures.’
As an academic with Deakin University, Dr Round is proud to work with an organisation that advocates a culture of equality and enhanced career opportunities for women.
‘There’s always more work to be done but we’re actively working to equip women with the skills needed to take up leadership positions. For example our MBA program is designed to be highly flexible in order to be more accessible to women who may be juggling work and carers responsibilities and need to fit studies into a very busy schedule,’ she says.
‘This scholarship represents tangible commitment to gender equality and aims to offer a fully-funded MBA scholarship to an aspiring female leader who would otherwise not have the opportunity to undertake MBA study.’
And while the push to increase the number of women occupying board positions continues, Dr Round says it’s also imperative that the broader issue of diversity is not overlooked.
‘Diversity through the gender lens is not the only view that’s important. Other aspects of diversity and inclusion – such as culture, race, religion and ability – are equally crucial.’